Dollar has its best year since 2005

The U.S. dollar ended its strongest year since 2005 with gains versus major rivals as investors penciled in further strength in the U.S. economy and diverging monetary policy paths between a more hawkish Federal Reserve and dovish European and Japanese central banks.

The benchmark DXY, +0.38% which measures the greenback against a basket of six rival currencies, traded at 90.269 in late North American trade, up 0.3% from Wednesday and by 12.8% since the end of 2013.

The wider WSJ Dollar Index BUXX, -0.01%  rose 0.38 point on Wednesday, to 83.04.

The euro EURUSD, +0.00% is down around 12% versus the dollar in 2014, which is also the biggest drop since 2005. The U.S. currency has advanced 13.8% against the yen USDJPY, -0.03%

The pound GBPUSD, +0.00% rose to $1.5578, from $1.5555 on Tuesday, but lost 5.9% against the U.S. unit for the year.

The Australian dollar AUDUSD, -0.04%  exchanged hands at 81.81 U.S. cents, down from 81.84 cents on Tuesday. The Aussie lost 8.3% versus the U.S. unit in 2014.